Institutional FX Insights: JPMorgan Trading Desk Views 6/5/26
JPMG10 FX Daily
Top Trading Takeaways
## EUR: Support Building, But Payrolls Keeps It Range-Bound
Despite the long weekend headline noise, price action held up well yesterday. The market seemed willing to look through the latest Iran missile and drone comments as not being enough of a material escalation. Then Trump’s overnight post suspending “Project Freedom” added another leg of relief, with negotiations apparently continuing.
We have been here before, so confidence in a durable deal should remain limited. But for now, the market is again leaning into the possibility of a resolution. That keeps the greenback under pressure, with the suspicious-looking yen price action overnight adding another USD-negative impulse.
Core conviction remains limited, even if price action has been constructive. I continue to trade around the short EUR/HUF and have taken some back at 360 initially.
I also bought some USD/CHF and EUR/CHF after Schlegel’s comments yesterday. If geopolitical risk does resolve, and payrolls delivers another strong print, CHF shorts look attractive at current levels. USD/CHF is being pressured by USD/JPY, but that should be used as an opportunity. On a weak payrolls print, adding to USD/JPY shorts against USD/CHF could help express the move more cleanly.
EUR/USD itself is not especially interesting here. There is clearly demand below 1.1700, particularly ahead of the 200dma, but the broader narrative remains negative for European growth. Higher energy prices and tariff risks remain material headwinds, and investors are already short EUR on the crosses on that basis.
With payrolls still ahead, it is hard to see EUR/USD travelling too far from current levels without fresh news.
Trade bias: Neutral EUR/USD near term.
Key point: If bullish, the stop is now obvious below recent lows.
EUR/HUF: Took some profit on short at 360.
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## GBP: Carry Still Wins While Starmer Survives
Round and round we go on Iran and the TACO trade. The needle has swung back toward relief after Trump paused Project Freedom, citing progress in talks. It remains hard to claim a real edge here, but the market’s underlying bias is still USD lower and risk higher, even if conviction remains thin.
Sterling deserves more attention in that environment.
Starmer’s coffee will be tasting better this morning — and not only because he is an Arsenal fan. Angela Rayner is having a poor press round, with the Times highlighting a lack of union support and the FT questioning her leadership credentials. Both reports underline the same point: Andy Burnham would likely be a more suitable and popular choice for the party, but he still needs to become an MP first.
That gives Starmer a stay of execution, even if Thursday’s local elections deliver the expected Labour bloodbath.
The market may not love Burnham’s fiscal rhetoric around the OBR rules, but that is not an immediate trade. For now, in a world still happy to own carry, it is difficult to be short GBP.
Flows were supportive too, with SHF decent GBP buyers yesterday, around 2z.
Trade bias: Buy cable dips.
Entry interest: Around 1.3550 today.
Key levels:
- Support: 1.3450
- Resistance: 1.3610
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## JPY: Intervention Count Rises, Trade the Range
USD/JPY traded 155.00 this morning in high-volume, local-selling fashion that looked consistent with MoF intervention. If correct, that brings the intervention count to four.
After recent MoF comments around IMF definitions, the market will likely frame this as the first day of a new intervention “episode,” given the scale of the move. Either way, it keeps us in a state of high alert.
I have covered USD/JPY shorts and will now trade the 155/158 range.
The touch of 155.00 looks like the objective achieved for today. From here, expect a slow drift higher. Officials will hope that this drift becomes slower and slower, but any repeat of yesterday’s stop-loss-driven spike through 157.30 could invite faster action.
Technical levels remain important. USD/JPY has still not closed below the bottom of the cloud, which sits at 156.28 today, while the top of the cloud is 158.48. The 200dma is down at 154.20.
Tokyo markets return from Golden Week tomorrow, and it will be important to see how aggressively locals fade the latest move — if they have not already. BoJ current account data also resumes, which should help clarify the size of the last three suspected intervention episodes.
Trade bias: Trade the 155/158 range.
Sell zone: Restart USD/JPY sell programme toward 157.00 intraday.
**Key supports:** 155.00, then 154.20 200dma.
**Key resistance:** 157.30, then 158.48 cloud top.
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## CHF: The Cleanest Funder
I remain short CHF against a basket of AUD and USD.
The CHF setup still looks asymmetric. The franc does not rally properly on risk-off headlines, and when CHF does strengthen, the SNB appears increasingly willing to push back. Schlegel was back on the wires yesterday, reinforcing that message.
That makes CHF one of the cleaner funders in G10.
The main headwind is USD/JPY. Moves lower in USD/JPY are dragging USD/CHF lower mechanically, but I am happy to use that as an opportunity to buy dips.
Flow remains mixed, but the key focus is systematics. They remain very long CHF, and the question is whether this position starts to turn.
Trade bias: Short CHF versus AUD and USD.
Preferred expression: Buy dips in USD/CHF; stay long AUD/CHF.
Risk: Further sharp USD/JPY downside dragging USD/CHF lower.
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## AUD/NZD: Long AUD Still the Right Trade
Yesterday’s view was that once the dust settled after the RBA, AUD should continue to find support. I did not expect to walk in with AUD/USD roughly 1.5% off the lows, but the move is welcome.
AUD was already firmer before the sharp move lower in USD/JPY added another leg higher. There is no change in the broader view.
I retain AUD longs against EUR and, to a lesser extent, against USD. With Trump reassessing the Operation Freedom initiative overnight, risk sentiment has improved and AUD should remain supported.
NZD also has a tailwind after unemployment fell by one-tenth.
Trade bias: Stay long AUD.
Preferred expression: Long AUD versus EUR; smaller long versus USD.
AUD/NZD: Still constructive, with NZ labour data supportive near term.
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## CAD: Sidelines Into Payrolls
Positive geopolitical headlines overnight — with Trump citing “great progress” toward an Iran agreement — have boosted risk sentiment and pushed the dollar lower. The sharp USD/JPY drop added to the move.
I had been running long AUD/CAD, but have now moved to the sidelines. The pair has struggled to make meaningful progress above 0.9800, and with headline-driven volatility likely to persist for another week, the market feels increasingly fatigued.
The next real focus is Canadian payrolls later this week. Until then, there is little reason to force the trade.
Flows were notable, with solid demand for USD/CAD yesterday, mainly from real-money accounts.
Trade bias: Sidelines for now.
AUD/CAD: Struggling above 0.9800.
Next catalyst: Canadian payrolls.
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!